Canada bans locked phones as it looks to make switching carriers easier
The Wireless Code of Conduct has received an update to address some of its widely-held complaints. But it doesn’t fix everything.
In a review of Canada’s Wireless Code of Conduct, which debuted in June 2013, the country’s telecom regulator has made two important changes that will potentially lower the cost of ownership and make it easier for consumers to switch providers.
In a statement, the Canadian Radio-television and Telecommunications Commission (CRTC) announced, as of December 1, 2017, the end of unlocking fees for Canadians with existing devices and, perhaps more significantly, a mandate that all new devices as of that day will need to be sold unlocked, even if purchased from a carrier on contract.
As of December 1, all Canadians will be able to request an unlock code for a locked phone from their carrier at no charge — currently, the Big Three providers charge between $35 and $50 for the service — which will allow it to be used on any competing network, domestically or while traveling abroad. It will also easily allow customers to switch carriers and bring their compatible phone over to a new one should they desire. What isn’t being said, though, is that many phones being sold at the carrier level today, including the Google Pixel and upcoming Essential Phone, are unlocked out of the box from the manufacturer. Other devices, like the Galaxy S8, are sold unlocked and become locked to the first SIM card inserted in the phone.
Switching to a different network will also be simpler under the new rules because customers will be able to cancel service contracts within 15 days while paying no penalties for phone restocking, something that the first draft of the Wireless Code tried to address but, according to consumer advocacy groups, didn’t go far enough.
Unlocked phones may be going away, but carriers will still pursue phone exclusives to differentiate themselves.
Given that the vast majority of Canadians pay one of three companies for mobile service, all of whom share a number of similarities in network speed, coverage, device availability and plan costs, this is more a convenience than anything else, but current return policies limit handset returns to 30 minutes of talk time and 50MB of data use, an absurdly rapacious set of numbers.
One of the most important changes to the Wireless Code is also going to be the least talked-about: secondary line users will no longer be able to consent to overage charges without the permission of the primary account holder. This means that parents will be able to supervise and approve roaming or data overage charges on a per-line basis, fixing an oversight in the first Wireless Code draft that caused millions of dollars in unnecessary fees. Primary account holders will still be able to let secondary lines approve overages, but it will be an opt-in process.
The existing overages of $50 for domestic and $100 international roaming are still in place, but the CRTC has explicitly stated that they apply to one’s entire account, not an individual line holder. For big families that share data plans, this may lead to limits being hit, and overages needing to be approved, far earlier in the billing cycle.
This will make it easier for Canadians to leave the carriers they love to hate.
Since its inception in 2013, and its strict enforcement in 2015, the Wireless Code has been criticized for allowing wireless carriers to continue raising the cost of service within the existing rules. Advocacy groups believe that without a robust MVNO market, where carriers sell wholesale access to their networks to smaller companies in a model popularized by broadband internet, Canadians will be forced to continue paying a high price for their monthly service. Carriers justify the prices by saying that, Canada being a huge country, network upgrades and maintenance are more expensive than anywhere else in the world, but critics point to a lack of competition keeping prices high.
The Wireless Code doesn’t mandate pricing, and these new changes, while admirable, don’t address the core issues of competition within the Canadian wireless market. Still, being able to move devices more freely, and having penalty-free service trials, will make it easier for Canadians to shop around, which may have the effect of lowering complaints against the companies Canadians love to hate.